B.C.'s top 100 companies of 2009: All that glitters is gold

Fiona Anderson, Vancouver Sun10.26.2010

Paul Wright, president and CEO of Eldorado Gold which grabbed the No.1 spot in The Vancouver Sun's Business Top 100.Glenn Baglo
/ Vancouver Sun

If successful, Wednesday’s deal will create a company in Eldorado Gold Corp. with combined market capitalization of about $6.4 billion and gold production of 550,000 ounces from mines in China, Turkey and South America.Handout photo
/ Vancouver Sun files

All that glitters is, in fact, gold — and in some cases, copper, silver or even sand and gravel.

Because, once again, British Columbia’s top companies for the past year are overwhelmingly miners.

Leading the pack as Business BC’s strongest company is Eldorado Gold, which moved up from 18th last year. The gold miner — with two operating mines and five exploration projects around the world — also ranked third on Business BC’s list of fastest-growing companies.

Rounding out the five strongest were two more gold producers — Goldcorp Inc. at number two and Red Back Mining, taking fourth spot — and two copper companies, Corriente Resources in third, and Quadra Mining in fifth.

Throw in some sand and gravel — Polaris Minerals, Business BC’s fourth fastest-growing company — and the pattern is repeated in the fastest-growing list. New Gold Inc. takes top honours in this list, Fortuna Silver, which mines both gold and silver, is runner-up, with Eldorado Gold third, and First Majestic Silver Corp., fifth.

Gold often shines when the world looks gloomiest, and the world looked pretty gloomy in 2008 and 2009.

“It’s kind of a go-to investment when you’re concerned about inflation [and] when you’re concerned about the strength of the U.S. dollar, which gold is priced in,” said Robert Gallagher, CEO of New Gold.

In 2008, the price of gold averaged $872 US an ounce, up almost 25 per cent from $699 US an ounce in 2007, according to a weekly commodity price report put out by TD Economics last week. The price reached $1,000 US last month and has stayed there, or well above, since.

“Gold did not go through an economic crisis; gold benefited from it,” said Pierre Gratton, president and CEO of the Mining Association of B.C.

“So if you were a gold company, you were doing okay — unless you were caught in the overall liquidity crisis,” he said.

But while more than 800 mining companies call B.C. home, most of them operate outside the country, Gratton pointed out. Like Eldorado Gold, which operates in Brazil, China, Turkey and Greece. New Gold, which has a mine it is developing near Kamloops, is almost an anomaly. But the company’s other projects are in Mexico, Australia, Brazil, Chile and California.

The trend speaks to an earlier era when much of B.C. was built around mining, Gratton said.

“And it’s always remained a place where the industry parks itself,” he said.

“So now we’ve got a lot of expertise. Some of the best legal minds in the world are here in Vancouver and some of the best financiers are here in Vancouver.”

That has made Vancouver a world centre for mine financing and exploration for years, Gratton said.

“This is where the brains are,” he said.

Miners are no strangers to Business BC’s list, often dominating. But in 2007, there were signs the economy was diversifying, with some alternative energy, technology and even health and nutrition companies making strong appearances and taking several top spots. But those companies were hurt in 2008, and some top performers in 2007 didn’t make the cut-off share price of $1 on May 31, 2009.

The drop in the price of oil may have played a role in keeping some technology companies off the list, said Helmut Pastrick, Central 1 Credit Union’s chief economist.

“To some extent [lower energy prices] have potentially taken some of the steam out of the short-term need for alternative energies,” Pastrick said.

But while the miners take the five top spots on the strongest list, eight of the province’s strongest 15 are not miners, including methanol-producer Methanex Corp., Westshore Terminal,s and Ritchie Bros. Auctioneers.

It’s still a far cry from when The Vancouver Sun published its first list of the province’s top companies in 2003. Then, only one miner — Northgate Exploration Ltd. — made it into the top 10 of what was then a single list of 100 companies. Non-miners Finning International, Great Canadian Gaming Corp., Imperial Parking, Ritchie Bros. and Intrawest took top honours.

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B.C.'s top 100 companies of 2009: All that glitters is gold

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